Intuit reported pro forma net income of $104.2 million, or $0.48 per share for the second quarter, beating consensus estimates for pro forma earnings per share by $0.03. However, its strong operating performance was offset by net charges of $71.9 million, including a charge of $0.15 eps taken against marketable securities and a $0.21 eps reduction for acquisition-related expenses, which whittled Intuit's net income for the quarter to $26.6 million, or $0.12 per share, off from $57.3 million, or $0.27 per share in the year-ago quarter.

The company reported revenue of $457.6 million for the second quarter, up 8 percent over the $425.5 million for the quarter a year ago.

The firm saw strong gains in its Web tax business, with over 780,000 federal returns completed using its Quicken TurboTax for the Web through Feb. 14, more than double the returns completed as of the same time last year. In the electronic filing arena, Intuit saw more than three million federal and state returns e-filed as of Feb. 10, more than double last year's levels.

The company also reported solid growth in its Quicken Loans and payroll services. Total Quicken Loans revenue was $20 million, up 27 percent from last year. Total payroll revenue for the second quarter was up 57 percent from a year ago to $30.2 million.

Intuit said sales of its popular QuickBooks software have been slower than expected because of lower-than-usual upgrader volume due to a one-time surge in sales caused by Y2K. While 20 to 30 percent of the user base usually upgrades in any one year, Intuit said fewer users are upgrading this season, since almost 50 percent of the base got a new product last year because of Y2K.

So far this year, Intuit has invested $50 million in emerging businesses, double last year's level. Among those emerging businesses are the recently launched Intuit Developer Network, which opened access to QuickBooks products to third-party developers, and its Web sharable database service, QuickBase, which was rolled out in December.

Intuit expects pro forma operating income of $205 million to $213 million for the year and fiscal year revenue of $1.32 billion to $1.34 billion.

-- SmartPros News Staff

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